Consulting Division: Stax, Inc. University of Notre Dame …sibc.nd.edu/assets/228983/stax_final_slide_deck.pdf · · 2017-03-06-LinkedIn Sales Navigator; LinkedIn Profinder Product

Consulting Division: Stax, Inc. University of Notre DameDecember 2, 2016

SIBC Introduction

§ Largest student-run organization on campus§ Amidst 26th academic year§ Founder: Frank Potenziani

“Peace Through Commerce”

MARKET OVERVIEW

3

MARKET LEADERS

PROMISING VENTURES

KEY TAKEAWAYS

PRIVATE EQUITY TARGETS

FINAL RECOMMENDATION

TEAM INTRODUCTION

4

Team Introduction

Team Leaders

Tatiana VdovinaJunior

Finance and German

Brian ChangJunior

Finance and Japanese

Team Members

Michael DavisSophomore

Business and Theology

Shuyi (Elaine) LiFreshmanBusiness

John (Johnny) SullivanSophomore

Accounting, Hesburgh Program in Public Service

Dillon WintzFreshmanBusiness

Yutong YaoSophomore

Science-Business and Economics

5

Executive Summary

Industry • Online job market

Ø Recruitment websites and headhunting/jobhuntingapplications, job boards

Investment type

• Private equityØ Can be implemented by private equity firms and

individual investors

Objectives• Establish a private equity strategy for a potential investor• Develop an LBO model for the acquisition target and make

a recommendation regarding the investment plan

Investment thesis

• Our team suggests Dice (DHI Group) as the current best private equity target

6

MARKET LEADERS

PROMISING VENTURES

KEY TAKEAWAYS



TEAM INTRODUCTION

MARKET OVERVIEW

Sources: IBIS World US

Online Job Market (1/3)

Industry Definition

This industry comprises online establishments engaged in• listing employment vacancies• referring job applicants to potential

employers• assisting companies with employee

recruitment and placement

Key Statistics

Online recruitment market is a growing industry with profit potential.

• Profit(2016): $329.5 million• Enterprises(2016): 3026

Industry Structure

• Life Cycle Stage: Growth• Regulation Level: Medium• Concentration Level: High• Globalization: Low & Increasing• Competition Level: High & Increasing• Barriers to Entry: Medium & Increasing

Industry Outlook in Five Years

Growing industry revenue• Continue growing over the next five years• Growth of annualized 6.9% to $5.2 billionIntensifying Competition• Existing players need differentiation• New players will enterExpansion of services• New online platforms and mobile

applications• Increase product offeringsEconomic & technological development

2684.8

3028.3

3452.2

3701.9

0 1,000 2,000 3,000 4,000

2013

2014

2015

2016

Revenue ($MM)

8Sources: Jobvite, McKinsey & Company report


Efficiencyoptimization

Competitive labor market

Candidates’ high expectation Cost reducing

Digital Revolution

ID Theft

Sensitive information being sold

Crisis of confidence

Fake employers’

posting

Legitimacy of the online

platform

• Data-based decision• Increase in the investment of recruiting

methods• Social media – an essential recruitment tool• Digital revolution - continuously making the

capabilities and potential of the job market evolve

87%55%

47%38%

21%14%13%

3%

LinkedIn

Facebook

Twitter

Glassdoor

YouTube

Google +

Instagram

Snapchat

Social Media Used by Recruiters

Emergence Trends

Risk FactorsGrowth Drivers



Online recruitment industry has limited product types, great demand, and fierce competition.

Number of broadband connections: 332.1m in 2017• Expected to rise by 10% for next 5 yearsCorporate profit: $1.97t in 2017• Expected to rise by 1.6% for next 5 yearsNational unemployment rate• Expected to fallNumber of temporary employees: 3.44m in 2017• Expected to rise

Finance, 13.1%

Business Administration and Support,

12.5%

Information Technology,

15.8%Healthcare,

21.0%

Manufacturing and Retail,

27.0%

Other, 10.6%

Premier career

services and subscription

s, 57.6%

Advertising and fees,

34.7%

Marketing and sales,

7.7%

LinkedIn Corp.39%

Indeed.com18%

CareerBuilder, Inc.16%

Monster.com11%

Other16%

Product Services Key External Drivers

Demand Determinants Major Companies

MARKET OVERVIEW

10

MARKET LEADERS

PROMISING VENTURES

KEY TAKEAWAYS



TEAM INTRODUCTION

Sources: LinkedIn 2015 10-K

LinkedIn Corp. (1/2)

Business Description

• Operates an online professional network that allow its member to create, manage and share professional identities, build and engage with professional networks, and find business opportunities

• Headquartered in Mountain View, California• Industry Classification:

- Internet Software and Services

Key Statistics (2015)

Offering a wide variety of career-related services, LinkedIn remains a market leader.

Company Timeline

• Talent solutions (63% of net revenue)- hiring solutions for enterprises- learning and development solutions

• Marketing solutions (19%)- advertising products for enterprises - sponsored updates

• Premium subscriptions (18%)- LinkedIn Sales Navigator; LinkedIn

Profinder

Product Lines

Key Items USD in Million Growth/Margin

Net Revenue 2990.9 34.8%

Net Income (loss) (164.8) 92.9%

EBITDA 779.8 31.7%

• Founded in 2002 • Completed a $352.8m IPO in May 2011• Acquisitions:

- mSpoke (2010)- SlideShare (2012)- Alphonso Labs (2013)- Bright Media Corporation & Bizo (2014)- Lynda.com (2015)- Connectifier & Woven (2016)

• Merge: Microsoft Corporation (2016)

12Source: Statista

LinkedIn Corp. (2/2)

Executive Team

Reid HoffmanExecutive Chairman

Co-founder

Jeff WeinerChief Executive Officer

Former Interim President

LinkedIn was co-founded by Reid Hoffman in December

2002 with two former

colleagues from SocialNet

0

50

100

150

200

250

300

350

400

450

500

Total Member Growth (millions)

2002-2010

LinkedIn is foundedIntroduces premium services for generating revenuesAchieves profitability in 2006 (being the first major social network/Web2.0 enterprise to do so)Becomes the most popular site for work-based networkingReaches 70 million users by June 2010

2010-2016

LinkedIn completes an IPOReaches beyond 100 million usersExpands more aggressively internationallyReaches 300 million members in 2013Reaches 400 million members in 2016Gets acquired by Microsoft in June 2016.


Monster.com

Monster has struggled recently due to competition and lack of differentiation.

• Market share: 11.1%• Revenue generated through job postings

and database of profiles and resumes for employers

• 2014: $770.1 million in global sales• 56.7% of revenue from US and Canada

• Industry revenue projected to fall 4& in 2016

• Suffered due to sluggish job recovery and competition (i.e. Indeed.com)

• Reduced costs and invested in potential growth areas in response

• Withdrew from Latin America and Turkey and reduced workforce

• Bought out by management and private equity in 2006

• Announced partnership with Twitter to increase ad-based revenue

• Affiliated with 1,000 newspapers• Purchased HotJobs for $225 million• Underwent recent restructuring to compete

more effectively

0

100

200

300

400

500

600

2011 2012 2013 2014 2015 2016

Revenue ($MM) Operating income ($MM)

Overview

U.S. Industry-Specific Revenue

Recent History

Financial Performance

MARKET OVERVIEW

14

MARKET LEADERS

PROMISING VENTURES

KEY TAKEAWAYS



TEAM INTRODUCTION

Sources: Business Insights: Essentials, LexisNexis

Glassdoor.com

Glassdoor is a quickly growing company with high potential, plenty of support, and increased site growth and traffic.

• Evolving Leader (small market share)• Job and recruiting site• Employees and former employees

anonymously review companies and management

• Founded in 2007, launched website in 2008

• Received funding from Benchmark• $3 million, $6.5 million, $12 million,

$50 million• Financing value close to $500 million• Facebook presence has led to 40% of

traffic from international users

• Currently private• Net sales $14.25 million• Acquired JobVent in 2009• Content from 200,000 companies in 190

countries in 2012• Won 2013 Webby Award for Best

Employment Site

Hired Adam C. Spiegel,

former CFO and

investment banker

Hints at taking

company public?

Overview

Future Direction

Recent History


Sources: 10-K, Yahoo Finance

Dice (DHI Group Inc.)

• Vertical specialization• Global opportunities• Research-oriented• Future development in mobile services &

marketing• Internationally stable: eFinancialCareers

revenue increased 4% year-over-year on a constant currency in face of Brexit and related situations

Dice is a promising PE candidate, which not only provides cross-industry resources, but also market potential.

• Engineering, Financial, Oil and Gas, Biotechnology, Hospitality, Healthcare, Clearance Jobs

• HR opportunities: Highly skilled professionals

• Strategic development: Notable industry leaders such as Hilton, Mayo Clinic, IBM and China Petroleum

• Core strategy• Core tech franchise—Tech/data resources• Next generation efficient career sourcing

Industry Trend - HR

HR Info: DHI-DFH Vacancy Duration Measure; DHI Hiring Survey

Consulting Research: PWC, Deloitte

Future of Dice

Mobile Services launched 2015-2016: including talent solutions

Marketing Development: from email & advertisement to perspective brand building

Dice U.S.• 77,000 job

postings

Dice EU• 19,000 job

postings

HCareers(Hospitality)

• 19,000 job postings

Overview

Global Opportunities Research Oriented

Vertical Specialization


Indeed.com

Though with solid support and international influence, Indeed.com lacks unique recruitment solutions and marketing strategies to ensure sustainable development.

• Solid support: Investments from NY Times Co., Allen & Company, and Union Square Ventures• International influence:

• Acquired by Japan-based Recruit Co. Ltd in October 2012 for an estimated $1.0 billion.• Covers more than 50 countries, with the US accounting for a majority of company revenue.

• Features:• Cost-saving to clients: Clients only pay a fee when they view a job posting • Salaries information, Trends, Company Search

120

320

482.3

675.6

0 100 200 300 400 500 600 700 800

2013

2014

2015

2016

Revenue ($MM)

History


18Sources: IBISWorld, McClatchy.com, Bloomberg, WSJ, NASDAQ

CareerBuilder.com

Tegna Inc.53%

Tribune Company

32%

The McClatchy Company

15%

• Jointly owned private company• 15.4% Job Search Market Share• Expansion through acquisitions: cover more

verticals, regions and job seekers• Stagnant revenue

567.7

578.9578.1

575.7

570570.6

562

564

566

568

570

572

574

576

578

580

2011 2012 2013 2014 2015 2016

Company Overview and History

Revenue ($MM) Company Ownership

Strategy

•Acquisitions- Jobs Central, JobScout, EMSI, Broadbean

•International- Asia, Germany

•Features- Career Consulting- Online Resume & application

CareerBuilder is a growing potential LBO target with a client focus on job seekers.

19Sources: Bloomberg Technology

Hired

• Tech, sales, marketing• Expected to profit by 2017• Raised $40 million in equity • Acquisitions expanded the company into

Paris and Melbourne

• Highly Personalized• Free to use• Niche appeal to highly skilled• Efficient business model

• Job seekers create a profile• Hired “accepts” a small percentage• Companies hire from a pool of highly skilled

people

Company Overview

How Does It Work? Strengths

It is too early for Hired to become an LBO target.

Sources: mashable.com; Bloomberg

Mashable Inc.

Mashable can be a potential acquisition target company but lacks fundamental recruitment-based features.

Social Media

Technology

BusinessMarketing

Design

Type - Date Target

Acquisition – 2016.6.20 Whalerock Industries, CineFix

Overview Job Niche

Recent Transaction

•Private, launched in 2005•Features & Resources:

•News & Blogs, Job Collection•Acquired Whalerock

•Influence: •45M individual monthly visitors•28M social media followers•UK, Asia, Australia, France

•Total revenue 2012: $15,000,000

MARKET OVERVIEW

21

MARKET LEADERS

PROMISING VENTURES

KEY TAKEAWAYS



TEAM INTRODUCTION

1Source: Monster Worldwide 2016 Financial Results; LinkedIn Corporation Form 10-K 2015

Monster and LinkedIn: Case Studies

While the two companies have similar operating models, their areas of focus determine their strategic development goals. Monster.com is focusing on investment in products and operations for the future, while

LinkedIn is focusing on maintaining their offering of products at no cost.

Strategy/Competitive Advantage• Strategic investment in product,

technology, brand support, and customer service

• Invest in operations on a global basis while controlling operating expenses

Successes• Significant realignment of sales

organizations to accelerate market expansion and acquire new customers

Potential Challenges• Increase of costs of maintaining brand

awareness and value of their brands

Strategy/Competitive Advantage• Provide many products at no cost to

customers• Help customers stay up to date on

news and ideas

Successes• Offering services to customers that

provide business benefits at no cost

Potential Challenges• Putting members first sometimes

conflicts with short-term interests of the business

• Falling behind on keeping technology up to date

Monster LinkedIn

Sources: LinkedIn 10K Form

LinkedIn Corporation (1/2)

LinkedIn has sustained growth due to well-established presence and clear strategies to achieve its goals.

• World’s largest professional network on the Internet: over 400 million members

• “Most extensive, accurate and accessible network focused on professionals”

• Value proposition: connect to opportunity• Platform used to stay connected and

informed, advance career and work smarter

Strategy

• Mission - connect world’s professionals to make them more productive and successful

• Prioritizing needs of members is most effective and most profitable means to accomplish mission and create long-term value

• Vision - create economic opportunity for every member of the global workforce

Stay connected and informedDelivering members relevant and highly engaging feed experience is critical in creating value

Advance my careerHelping members get hired and learn new skills is an essential element

Work smarterValue created for members and customers through monetized products

Core Business Operations

2Source: LinkedIn 10-K Report

LinkedIn Corporation (2/2)

• Members-professional networks: Face increased competition from established and rising companies

• Enterprises and Professional Organizations-Talent Solutions: Must continue to improve efficiency and effectiveness of HR services

• Enterprises and Professional Organizations-Marketing Solutions: LinkedIn risks losing advertisement revenue to third party competition

• Premium Subscriptions and Sales Solutions: LinkedIn may lose subscription revenue to other companies who are more established in this industry subset.

• Core value of putting customers first may conflict with short-term interests of business: Risk losing revenue opportunities

• Existing technology and website infrastructure: May need to update infrastructure to maximize customer satisfaction

• Possible Inability to operate on mobile devices

• Growth in Mobile Device Use Could Impact Desktop Use: May lose desktop advertisement opportunities

• Seasonality: As revenue growth slows, seasonal fluctuations could become more pronounced

While LinkedIn faces significant market competition, the risks it faces are not unique to its company, but rather the industry as a whole

Market Competition Risks Related to Business

Source: Monster Financial Results and Supplements, IBIS World

Monster.com

Monster has recently made changes to its strategy. Although results have been good so far, there are still high risks, and the company has failed to outpace its closest competitor, LinkedIn

• Revenue generated through job postings and database of profiles and resumes for employers

• Alliances with various media outlets to drive users to its site

• Operations in more than 40 countries

• Reallocation has shrunk net revenue• Could lead to smaller presence in the

industry• Could make Monster more efficient and

ready to grow significantly• Past months show that reallocation has

significantly lowered operating costs and increased income

• Reallocation February 10, 2015• Global workforce reduction of 300

employees, lease exit costs, impairment of certain assets, office and general expense controls

• Resulting in annualized cost savings of $40 million

-$15

-$10

-$5

$0

$5

$10

$15

Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016

Operating income (loss) (in $MM)

Core Business Strategy

Results of Reallocation Risks

26

Conclusion

q Growth of the industry slowing down

q Differentiation is the key

q Global presence

q Cost efficiency

q Steady member growth

q Supplementary premium membership

q Research oriented

MARKET OVERVIEW

27

MARKET LEADERS

PROMISING VENTURES

KEY TAKEAWAYS



TEAM INTRODUCTION

28

Methodology

• Effectively targets specific, popular industries

- Focus on technology industries

• Growing revenue

• Global presence

• Research oriented

• Global presence

• Rapid member growth

• Diverse revenue streams

- Membership/subscription

• Unique service

- Anonymous reviews, comprehensive company insights

Dice

Glassdoor

Sources: DHI 10-K Form, NYSE

Why Dice?

Dice has established presence in the information technology and engineering online employment sector. This sector has high growth potential and will eventually have a high demand for qualified individuals

looking for employment

Reasoning and Rationale

Stock Performance

Growth Opportunities• High potential for growth in information

technology and engineering• Results in need for employment• Dice can connect employers to qualified

individuals• Dice has high potential for growth

• Dice is already well-established• Ready for growth• High potential for growth• Information technology and engineering will

only become more important in the future

Financials

$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

$300.00

2011 2012 2013 2014 2015

Revenue$6.55

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

$11.00

$12.00

Nov-11 Nov-12 Nov-13 Nov-14 Nov-15

30Source: CapIQ

Dice Comparable Companies

It is difficult to find a core comparable for Dice, given its low market capitalization and revenue volume. However, because Dice performs significantly worse than some younger Internet companies (its aspirational comparable set), we can conclude that DHI Group will be better off in the arms of a private equity investor

Company Name Latest Close Price

Market Cap Enterprise ValueEV/Revenue EV/EBITDA Price/Earnings

LTM 2016E LTM 2016E LTM 2016E

LinkedIn Corporation $195.15 $26,449.87 $24,275.41 6.7x 6.4x 50.9x 21.3x -554.3x 44.5xTwitter, Inc. 18.06 12,811.64 10,801.68 4.3x 4.2x 259.2x 15.1x -54.9x 32.5xFacebook, Inc. 120.38 346,955.32 320,815.32 13.0x 11.8x 24.9x 18.2x 51.2x 24.2xAlphabet, Inc. 780.23 531,364.80 452,246.80 5.3x 5.1x 16.0x 12.6x 37.3x 19.8xSEEK Limited 15.00 5,197.19 5,898.49 6.1x 0.0x 16.4x 0.0x 39.5x 25.3x

75th Percentile 195.15 346,955.32 320,815.32 6.7x 6.4x 50.9x 18.2x 39.5x 32.5x

Mean 225.76 184,555.76 162,807.54 7.1x 5.5x 73.5x 13.4x -96.2x 29.3x

Median 120.38 26,449.87 24,275.41 6.1x 5.1x 24.9x 15.1x 37.3x 25.3x25th Percentile 18.06 12,811.64 10,801.68 5.3x 4.2x 16.4x 12.6x -54.9x 24.2x

DHI Group, Inc. $6.60 $328.55 $389.81 1.64x 1.78x 7.51x 7.61x 17.73x 18.33x

Implied DHX EV (mean) $ 1,678.50 $1,199.95 $3,813.55 $993.84 $3,826.98 $746.75Implied DHX EV (median) $1,448.60 $1,107.72 $1,294.24 $1,113.88 -$1,398.15 $654.88

Implied DHX Market Cap (mean) $1,617.25 $1,138.69 $3,752.29 $932.58 $3,765.73 $682.33Implied DHX Market Cap (median) $1,387.34 $1,046.46 $1,232.98 $1,175.14 -$1,459.41 $590.46

Company Name LTM Revenue 2016E Revenue LTM EBITDA 2016E EBITDAExp. Revenue Growth Exp. EBITDA Growth Margins1 Year 2 Year 1 Year 2 Year EBITDA

LinkedIn Corporation $3,615.05 $4,311.16 $477.35 $1,138.36 26.9% 22.7% 46.0% 28.9% 13.2%Monster Worldwide, Inc. 612.70 - 54.40 - - 0.0% 0.0% 0.0% 0.0% 0.0%Twitter, Inc. 2,522.89 2,708.86 41.67 $717.02 15.2% 12.7% 28.5% 23.1% 1.7%Facebook, Inc. 24,670.00 34,154.91 12,863.00 $17,626.22 52.3% 43.1% 57.2% 43.8% 52.1%Alphabet, Inc. 85,537.00 99,308.00 28,294.00 $35,849.54 19.0% 17.4% 21.0% 19.0% 33.1%SEEK Limited 965.40 1,037.03 346.60 $374.55 9.1% 9.6% 7.8% 10.2% 35.9%

DHI Group, Inc. $237.09 $218.64 $51.89 $73.94 -12.7% -8.0% -22.0% -15.4% 21.9%

31Source: CapIQ

Dice Discounted Cash Flow

Discounted Cash Flow Analysis FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Years 1.0 2.0 3.0 4.0 5.0

Revenue $ 213.48 $ 262.62 $ 259.77 $ 285.92 $ 315.42 $ 348.79 $ 374.85 $ 410.86

Less: COGS (23.43) (37.21) (39.15) (43.09) (47.53) (52.56) (56.49) (61.92)

Less: Operating Expenses (175.30) (216.61) (219.59) (196.08) (214.74) (235.71) (251.45) (273.55)

EBIT 14.76 8.80 1.03 46.75 53.15 60.51 66.91 75.39

Taxes 9.59 5.72 0.67 28.05 31.89 36.31 40.15 45.24

NOPAT 5.17 3.08 0.36 18.70 21.26 24.21 26.76 30.16

Plus: Depreciation 17.40 27.20 23.19 25.53 28.16 31.14 33.47 36.68

Change in Working Capital 1.22 (10.78) (3.19) 34.82 11.65 13.17 10.29 14.22

Less: Capex (10.56) (8.71) (9.08) (11.20) (12.36) (13.67) (14.69) (16.10)

Unlevered Free Cash Flow $ 13.24 $ 10.79 $ 11.28 $ 67.85 $ 48.71 $ 54.85 $ 55.83 $ 64.96

WACC 9.38%

PV of FCF $62.03 $40.71 $41.92 $39.01 $41.49

WACC8.5% 8.9% 9.4% 9.9% 10.4%

Exit

Mul

tipl

e 8.5x 16.75 16.46 16.10 15.75 15.418.0x 15.97 15.69 15.35 15.02 14.707.5x 15.18 14.92 14.60 14.28 13.987.0x 14.40 14.15 13.85 13.55 13.266.5x 13.62 13.38 13.09 12.81 12.54

Exit Multiple Terminal ValuePV of Projected Period $225.16 2020E EBITDA 112.07 EBITDA Multiple 7.5x

Terminal Value $841.68 Discount Years 5.0 PV of Terminal Value $537.64

Enterprise Value $762.802016A Net Debt $66.95Implied Market Cap $695.85Diluted Shares Outstanding 47.57Implied Share Price $14.63Current Share Price $6.60Upside / Downside 121.6%

Dice demonstrates significant unrealized intrinsic value in the cash flow analysis

32Source: CapIQ

Dice Leveraged Buyout

Proforma Financials

Fiscal Year Ending Jan

31 AssumptionsFY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Current Share Price $6.6

Revenue $259.8 $285.9 $315.4 $348.8 $374.8 $410.9 Premium (10.0%)Total Expenses 218.6 282.8 286.2 319.2 337.4 369.7 Offer Price $5.9

EBIT $41.2 $3.1 $29.2 $29.6 $37.4 $41.2 Shares Outstanding 49.0 Less: Interest Expense (3.3) (3.3) (3.3) (3.3) (3.3) (3.3) Purchase Price $291.1

EBT $37.9 ($0.2) $25.94 $26.3 $34.1 $37.9 Plus: Debt 90.7

Taxes (14.0) (16.6) (19.2) (21.7) (23.9) (26.8) Less: Cash 29.4

Effective Tax Rate 37.0% 33.2% 34.0% 34.0% 34.0% 34.0% Transaction Value $352.3 Tax Effected EBT $23.9 ($16.8) $6.75 $4.6 $10.3 $11.1

Plus: Depreciation & Amortization $23.2 $25.5 $28.2 $31.1 $33.5 $36.7 FY 2015 EBITDA $64.37 Change in Working Capital (14.4) 26.2 9.7 10.9 8.5 11.8 EBITDA Multiple 7.2x Less: Capital Expenditures (9.1) (11.2) (12.4) (13.7) (14.7) (16.1) Entry Multiple 5.5x Less: Scheduled Senior Debt Paydown (2.3) (2.3) (2.3) (2.3) (2.3) Exit Multiple 8.0x

Cash Available for Debt Paydown $23.5 $21.5 $29.96 $30.7 $35.3 $41.2 Less: Discretionary Debt Paydown (21.5) (30.0) (30.7) (35.3) (41.2) Sources and Uses

Excess Cash Flow $0.00 $0.00 $0.00 $0.00 $0.00 Multiple % Total AmountDebt Schedule Senior Debt (TLB) 3.5x 47.9% $225.3 TLB $225.3 $201.5 $169.3 $136.3 $98.7 Notes 0.5x 6.8% 32.2 Notes 32.2 32.2 32.2 32.2 32.2 Excess Cash (15.0%) (70.6)

Total Beginning Balance $257.5 $233.7 $201.5 $168.5 $130.9 Sponsor's Equity 60.2% 283.1 TLB Mandatory Repayment (1% Amort.) ($2.3) ($2.3) ($2.3) ($2.3) ($2.3) Total Sources 470.0 Discretionary TLB Debt Paydown (21.5) (30.0) (30.7) (35.3) (41.2) Transaction Value 75.0% $352.3

Total Debt Paydown ($23.8) ($32.2) ($33.0) ($37.6) ($43.5) Minimum Cash Balance 21.3% 100.0 TLB $201.5 $169.30 $136.31 $98.74 $55.24 Transaction Expenses 3.7% 17.6 Notes 32.2 32.2 32.2 32.2 32.2 Total Uses $470.0

Total Ending Balance $233.7 $201.5 $168.5 $130.9 $87.4 Debt/EBITDA 4.0x Cash BalanceBeginning Balance $100.0 $100.0 $100.0 $100.0 $100.0 Investor ReturnsPlus: Excess Cash Flow 0.00 0.00 0.00 0.00 0.00 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Total Ending Cash Balance $100.0 $100.0 $100.0 $100.0 $100.0 EBITDA $28.6 $57.4 $60.7 $70.9 $77.8 Interest Expense Multiple 8.0x TLB 5.0% 5.0% 5.1% 5.2% 5.4% EV $622.7 Senior Unsecured Debt 10.0% 10.0% 10.0% 10.0% 10.0% Out. Debt $233.7 $201.5 $168.5 $130.9 $87.4

Average Interest Rate 5.7% 5.7% 5.9% 6.2% 6.7% Cash (100.0) (100.0) (100.0) (100.0) (100.0)TLB $10.7 $9.3 $7.7 $6.1 $4.1 Net Debt $133.7 $101.5 $68.5 $30.9 ($12.6)Senior Unsecured Debt 3.2 3.2 3.2 3.2 3.2 11/30/2016 12/31/2016 12/31/2017 12/31/2018 12/31/2019 12/31/2020

Total Interest Expense $13.9 $12.5 $11.0 $9.3 $7.4 ($283.1) $635.3 IRR 21.9%

FY 2016 FY 2017 FY 2018 FY 2019 FY 2020EBITDA/Interest Expense 2.06x 4.60x 5.54x 7.63x 10.58xEBITDA/Total Mandatory Payment 1.77x 3.89x 4.59x 6.14x 8.10x

Even though Dice shows significant potential as a PE target company, a successful LBO is only possible with a low premium or at a discount

Sources: glassdoor.com, linkedin.com

Why Glassdoor?

• Growing database: millions of company reviews and ratings

• Global presence: expansion into global markets, especially Europe

• Sheer volume of growth and traffic on the sitee.g. Profile page of Dell visits increased from 50,000 times/month to 100,000 times/month in 18 months

• Could expand job target search to have bigger presence in online employment industry

• Employee based: CEO ratings, HR reviews, salaries, etc.

• Mistrust of employers would be a reason to go to Glassdoor

• Could be good supplement to job search• Moderate reviews:

• Pros and Cons required in a review• Avoid pure, biased complaints• Trusted by job seekers

Unique Standpoint

Sales Volume Growth

Potential

Glassdoor is a company with rapid growth, global presence, and differentiation points.

0.00 m

0.50 m

1.00 m

1.50 m

2.00 m

2.50 m

07 08 09 10 11 12 13 14 15 16

Sales Volume in USD

34Source: CapIQ

Glassdoor Comparable Companies

Company Name Latest Close Price

Market Cap Enterprise ValueEV/Revenue EV/EBITDA Price/Earnings

LTM 2016E LTM 2016E LTM 2016E

DHI Group, Inc. $6.60 $328.55 $389.81 1.6x 1.7x 7.5x 6.7x 17.7x 20.5x

SEEK Limited 15.00 5,197.19 5,898.49 6.1x 0.0x 16.4x 0.0x 39.5x 25.3x


Mean 10.80 2,762.87 3,144.15 3.9x 0.9x 12.0x 3.4x 28.6x 22.9x

Median 10.80 2,762.87 3,144.15 3.9x 0.9x 12.0x 3.4x 28.6x 22.9x


Company Name LTM Revenue 2016E Revenue

LTM EBITDA 2016E EBITDAExp. Revenue Growth Exp. EBITDA Growth Margins

1 Year 2 Year 1 Year 2 Year EBITDA

DHI Group, Inc. $237.09 $218.64 $51.89 $58.14 -12.7% -8.0% -22.0% -15.4% 21.9%

SEEK Limited 965.40 1,037.03 346.60 $374.55 9.1% 9.6% 7.8% 10.2% 35.9%

CareerBuilder, LLC 21.30 N/A (34.70) N/A N/A N/A N/A N/A N/A

Axel Springer Norway AS 113.00 N/A 4.20 N/A N/A N/A N/A N/A N/A

en-japan Inc. 254.70 N/A 65.30 N/A N/A N/A N/A N/A N/A

Glassdoor’s comparable companies set mostly consists of small human resources and employment companies. Although this valuation is not a direct comparison of Glassdoor’s financials to the industry, we can have a better

understanding of what to expect when entering the market

MARKET OVERVIEW

35

MARKET LEADERS

PROMISING VENTURES

KEY TAKEAWAYS



TEAM INTRODUCTION

36

Final Recommendation

§ Focus on growing technology industries

§ Growth potential in the arms of private equity investor

§ DHI Group has other specialized service offerings

§ Lack of financial information on Glassdoor

§ Purchase price: $291.1 Million

Documents

Consulting Division: Stax, Inc. University of Notre Dame …sibc.nd.edu/assets/228983/stax_final_slide_deck.pdf · · 2017-03-06-LinkedIn Sales Navigator; LinkedIn Profinder Product